99 F.4th 557
9th Cir.2024Background
- Plaintiffs brought a putative class action under the California Consumers Legal Remedies Act (CLRA) against Nutramax Laboratories for allegedly falsely marketing Cosequin, a canine joint health supplement.
- Plaintiffs claimed Cosequin was marketed as improving dog joint health, but peer-reviewed studies showed no meaningful efficacy over a placebo.
- The district court certified a class of California purchasers who bought certain Cosequin products and were exposed to four specific packaging statements regarding joint health.
- Plaintiffs proposed a conjoint analysis by their expert, Dr. Dubé, to estimate the price premium attributable to the allegedly misleading claims, although the survey had not yet been conducted at the certification stage.
- Nutramax appealed, challenging (1) reliance on an unexecuted damages model for predominance, and (2) whether reliance/causation was susceptible to common proof given variations in packaging and consumer motivations.
- The Ninth Circuit affirmed the district court’s class certification, emphasizing that reliability of the damages model and materiality of the alleged misrepresentations were sufficient at this stage.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Reliance on unexecuted damages model for predominance | A reliable, though unexecuted, damages model is sufficient for class certification if it can show damages are susceptible to common proof. | Actual execution of the damages model is necessary to demonstrate predominance; otherwise, there’s no evidence of classwide injury. | Plaintiffs may rely on a reliable, not-yet-executed model if the court finds it reliably calculates damages for the class. |
| Reliability/admissibility of damages expert under FRE 702 | Dr. Dubé’s methodology is well-established, reliable, and has been accepted in similar cases; only implementation remains. | Dr. Dubé’s model is underdeveloped (survey questions, samples, data missing) and thus unreliable for class certification. | Limited Daubert analysis is sufficient at certification; methodology was reliable and sufficiently developed. |
| Common proof of reliance/causation under the CLRA | Materiality of the misrepresentations supports an inference of reliance on a classwide basis. | Reliance would vary because consumers relied on other sources, like veterinarians, not product labels. | Reliance is susceptible to common proof; presumption not rebutted since material misrepresentations predominated. |
| Weight of defense expert testimony | Defense evidence did not contradict that packaging statements were material and misleading to a reasonable consumer. | Survey evidence shows vets/main sources, not label, motivated purchase; statements not material to all purchasers. | District court did not abuse discretion in giving weight to plaintiffs’ common evidence over defense experts. |
Key Cases Cited
- Stearns v. Ticketmaster Corp., 655 F.3d 1013 (9th Cir. 2011) (material misrepresentation to entire class can create inference of reliance under CLRA)
- Halliburton Co. v. Erica P. John Fund, Inc., 573 U.S. 258 (2014) (plaintiffs must prove Rule 23 requirements at certification)
- Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011) (commonality requirement tests for common answers apt to drive resolution)
- Comcast Corp. v. Behrend, 569 U.S. 27 (2013) (damages model must be tied to theory of liability for predominance)
- Tyson Foods, Inc. v. Bouaphakeo, 577 U.S. 442 (2016) (method of proof for class must apply in common to all members)
- Amgen Inc. v. Conn. Ret. Plans & Tr. Funds, 568 U.S. 455 (2013) (merits questions at certification only insofar as relevant to Rule 23)
- Sali v. Corona Reg’l Med. Ctr., 909 F.3d 996 (9th Cir. 2018) (inadmissibility alone is not a ground to reject evidence at class certification)
- Olean Wholesale Grocery Coop., Inc. v. Bumble Bee Foods LLC, 31 F.4th 651 (9th Cir. 2022) (court analyzes method, not persuasiveness, of proposed classwide proof)